The importance of choice of channels of distribution

The channel chosen, whether direct from factory to consumer or through functional and merchant middlemen, has a great deal to do with the destination reached by the goods, the cost at which they reach this destination, the utility, value and satisfaction derived by the consumer from the goods.
The choice of channels will also determine the type of coverage obtained by a seller, and the services provided to both seller and consumer in the process of transferring both the physical goods and the ownership of the goods from producer to consumer. In a mass- production economy, such as we have in our complex industrial society, goods must be moved from point of production to point of consumption. This involves people, services, equipment, expense, and the passage of time.
Without this service of getting goods from point of production to point of consumption, we could not have mass production. By its very name, mass production implies production in far greater quantities than can be consumed by the people living near a factory. The bigger the production, the larger the market must be. Markets-regional, national and world-wide-would be impossible without distribution; and distribution would be impossible without the channels which render the services and perform the necessary functions. To this extent, therefore, middlemen and channels of distribution might be said to be synonymous.
When the consumer performs any part of the necessary functions of movement and transfer, such as ordering by mail, or carrying purchases home, he himself is performing as a middleman. The same is true of a manufacturer who chooses to sell direct, through sales men who sell house-to-house. The independent performer might thus be eliminated, but not the performance or function.
Thus, the choice of channels will influence not only the extent of the market attained by the seller and the service rendered the consumer, but will influence employment, total earnings, volume of goods manufactured and sold, and volume of goods consumed. It will influence the standard of living and the well-being of the nation as a whole. For this reason, many marketing people believe that the proper choice of channels is one of the most important management decisions in marketing.